Buying in phases

Phased retirement is designed to allow retirees to buy annuities or transfer their pension to income drawdown in stages - rather than buying an annuity all at once on retirement. This allows the bulk of their retirement fund to remain fully invested to benefit from the potential of future growth. Such remaining funds which are unused or "unvested" can be passed on to other people without a tax charge in the event of the member's death before age 75 and are usually deemed to fall outside of the estate for inheritance tax purposes. A phased retirement plan works by allowing parts of the pens...